Eurozone equities slide as London advances

Eurozone markets closed lower yesterday as investors turned cautious despite upbeat German data, while London held onto some gains on a weak pound and plans to expand busy Heathrow Airport.
UK stocks rose after the government backed Heathrow’s expansion, in a move it said would bring economic benefits worth up to £61bn (€69bn, $75bn). London share prices ended the day 0.45% higher, with index at 7,017.64 points.
In the eurozone’s main markets, Paris slipped 0.3% at 4,540.84 points at the close and Frankfurt dipped by 0.04% at 10,757.31 points. German business confidence defied predictions in October, hitting the highest level since April 2014, the Ifo economic institute revealed.
The Munich-based institute’s headline business confidence index hit 110.5 points in October, up one point from the September reading of 109.5 points.
In London, British Prime Minister Theresa May’s government approved a third runway at Heathrow Airport after a long-running row that pitted environmental campaigners and local residents against the business community.
The government said the move would create 77,000 additional local jobs over the next 14 years.
Proposals to expand an existing runway at Heathrow or build a second runway at Gatwick airport were rejected.
ETX Capital trader Neil Wilson said the announcement was a “good signal” for businesses, but cautioned that it could take “a very long time” — and added there were still concerns over who would foot the bill.
On the downside in Europe, Milan stocks dipped 0.4% on fresh turmoil in the Italian banking sector, after troubled lender Monte Paschi di Siena (BMPS) unveiled plans to axe 2,600 jobs and close 500 branches.
BMPS unveiled the overhaul as it posted a net loss of €1.15bn ($1.3bn) in the third quarter.
Its shares lost nearly 15% at the close.
Italy’s third-biggest lender will also seek improvements of its loans and risk reduction.
“It is the kind of bitter pill the Italian banking sector as a whole better get used to taking if it wants to avoid being the biggest threat to the eurozone’s stability,” said Spreadex analyst Connor Campbell.
On Wall Street stocks dipped on Tuesday as caution over the US presidential election offset a trove of largely solid corporate earnings.
Briefing.com analyst Patrick O’Hare said investors are “on edge” due to uncertainties, such as the possibility that a cyberattack could disrupt the vote.
“Hesitation over the election is likely one of the reasons why trading volume has continued to be light,” O’Hare said.
Around mid-day in New York, the Dow Jones Industrial Average was down 0.3%, which was the same drop for the broad-based S&P 500.